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There Was A Study Done In The Early 20th Century Of All The Entrepreneurs Who Entered The Automobile Industry Around The Same Time As Henry Ford; There Were Something Like 500 Automotive Companies That Got Funded, Had The Internal Combustion Engine, Had The Technology, And Had The Vision. Sixty Percent Of Them Folded Within A Couple Of Years.

-Eric Ries

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There Was A Study

Eric Ries

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There Was A Study Done In The Early 20th Century Of All The Entrepreneurs Who Entered The Automobile Industry Around The Same Time As Henry Ford; There Were Something Like 500 Automotive Companies That Got Funded, Had The Internal Combustion Engine, Had The Technology, And Had The Vision. Sixty Percent Of Them Folded Within A Couple Of Years.

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There Was A Study Done In The Early 20th Century Of All The Entrepreneurs Who Entered The Automobile Industry Around The Same Time As Henry Ford; There Were Something Like 500 Automotive Companies That Got Funded, Had The Internal Combustion Engine, Had The Technology, And Had The Vision. Sixty Percent Of Them Folded Within A Couple Of Years.

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Because Startups Often Accidentally Build Something Nobody Wants, It Doesn’t Matter Much If They Do It On Time And On Budget. The Goal Of A Startup Is To Figure Out The Right Thing To Build - The Thing Customers Want And Will Pay For - As Quickly As Possible.

New Customers Come From The Action Of Past Customers

What If We Found Ourselves Building Something That Nobody Wanted? In That Case What Did It Matter If We Did It On Time And On Budget?

Building Something

Nowadays People Talk About Paypal's Founders As Prescient Geniuses Who Would Inevitably Change The World. It Was, However, Not So Obvious That Paypal Would Taste Its First Major Success By Helping People Sell Beanie Babies On Ebay. But They Had A Vision, A Hope, And The Perseverance To Try Multiple Iterations Until They Got It Right.

When Blame Inevitably Arises, The Most Senior People In The Room Should Repeat This Mantra: If A Mistake Happens, Shame On Us For Making It So Easy To Make That Mistake.

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All Innovation Begins With Vision. It’s What Happens Next That Is Critical.

Customers Don't Know What They Want. There's Plenty Of Good Psychology Research That Shows That People Are Not Able To Accurately Predict How They Would Behave In The Future. So Asking Them, 'would You Buy My Product If It Had These Three Features?' Or 'how Would You React If We Changed Our Product This Way?' Is A Waste Of Time. They Don't Know.

Our Educational System Is Not Preparing People For The 21st Century. Failure Is An Essential Part Of Entrepreneurship. If You Work Hard, You Can Get An 'a' Pretty Much Guaranteed, But In Entrepreneurship, That's Not How It Works.

Most Companies Are Busy Making Their Products Worse, Not Better. Updating Is Almost Always A Disaster.

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As An Entrepreneur, I Knew That If My Company Failed, I Could Always Try Again. So I Often Felt That The Only Real Risk Of True Financial Ruin Came From The Possibility Of A Serious Illness That Either Exceeded My Insurance Plans Lifetime Limits, Or Was Not Covered Due To Rescission.

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